HC Deb 16 July 1962 vol 663 cc20-3
22. Mr. Ridley

asked the Minister of Power when the first commercial size advanced gas-cooled reactor power station will be ordered.

Mr. Wood

The Central Electricity Generating Board has not yet decided whether to order a power station with an advanced gas-cooled reactor.

Mr. Ridley

I am obliged to the Minister for that Answer, but will he take care that no large programme of nuclear power station building is undertaken which will not result in electricity being produced at least as cheaply as by conventional means and not waste any of the taxpayer's capital in this way between now and the first economic station?

Mr. Wood

That is obviously very important, but it is important also that we should keep abreast of nuclear power developments. As my hon. Friend will have noticed, the capital costs of nuclear generation are decreasing very considerably.

31 and 32. Mr. Nabarro

asked the Minister of Power (1) having regard to Hunterston financial experiences, what revised estimates he has now made of the cost per unit of nuclear generated electricity in England and Wales, compared with the cost per unit generated by conventional methods; and

(2) having regard to financial implications of capital costs at Hunterston, whether he will state his revised estimates of capital costs, respectively, for Berkeley, Bradwell, and Sizewell.

Mr. Wood

The figures I gave in my replies to my hon. Friend the Member for Dorset, West (Mr. Wingfield Digby) on 19th February still stand.

Mr. Nabarro

Is it not a fact that since 19th February the House has been somewhat alarmed by the sensational increase in capital costs for the construction of the nuclear power station at Hunterston? Will not the same factors which operated in those cost increases apply to the three English nuclear stations which I have named? If that hypothesis is correct, as I believe it to be, is it not a fact that within a measure-able space of time these large increases in capital costs of nuclear stations will be reflected in an increase in the cost of electricity per unit generated?

Mr. Wood

I appreciate the penetrating nature of my hon. Friend's supplementary question. I think that the answer to it is that the bulk supply tariff of the Generating Board to which retail tariffs are related takes into account the Board's costs as they arise. Therefore, I think that my hon. Friend can be assured that the electricity tariffs already reflect the increased costs of the nuclear power stations compared with the estimates which were originally made.

Mr. Ridley

If one of my hon. Friend's considerations is the same as that of Sir Christopher Hinton, namely, to keep the assembled skill and talent in the consortia together for building these uneconomic power stations, would it not be cheaper to provide some form of subsidy for the companies to keep their staffs together rather than build a lot of uneconomic stations?

Mr. Wood

I think that the Generating Board's obligations in this matter are dictated by the contracts which they have made with the consortia. If the consortia have any complaints to make about the framework of the contracts which they have reached with the Generating Board, then naturally the Board would be very ready to entertain them.

Mr. Nabarro

Does my right hon. Friend's earlier reply to me infer, as it seems to infer, that the increased capital cost of the nuclear power stations as completed is being offset or equated to reduced capital costs of the conventional stations? If that is not correct, then it follows that the cost per unit of electricity must rise. Can my right hon. Friend respond to that?

Mr. Wood

I will do my best to do so. I tried to explain to my hon. Friend that the bulk supply tariff of the Board depends on the costs, not only of the nuclear stations, but of the conventional stations. If there are compensating decreases in the costs of the conventional stations, they will be reflected in the ultimate bulk supply tariff. My main point is that the bulk supply tariff is adjusted as the differences in the costs of these two kinds of stations become apparent.

Mr. Warbey

Is not the output of the nuclear power stations to which the hon. Member for Kidderminster (Mr. Nabarro) refers likely to be greater than the original estimates? Can the Minister say whether the cost per kilowatt of output capacity has increased beyond the original estimates?

Mr. Wood

Is the hon. Gentleman referring to the unit cost or the capital cost per kilowatt?

Mr. Warbey

The capital cost.

Mr. Wood

That has decreased and is decreasing very considerably. I told my hon. Friend the Member for Dorset, West (Mr. Wingfield Digby) that the present capital cost is about £165. The capital cost in three or four years' time will be about £100.

Sir C. Osborne

Is my right hon. Friend satisfied that there is a proper and adequate check on these rising costs? Who watches the increases? Is there anyone to say "No" to the increased prices put before the authorities?

Mr. Wood

Part of the increased cost is due to changes in design. Obviously, spread over a period of years, there are bound to be changes in design worth incorporating in the newer stations. Part of the increased cost is due to the increased costs of labour and materials and these are taken into consideration by the Generating Board in the terms of the contract which it makes with the consortia.